Corporate social responsibility plays growing role in business

PUBLISHED : Thursday, 28 April, 2005, 12:00am
UPDATED : Thursday, 28 April, 2005, 12:00am

Firms that ignore issue may find themselves out in the cold

THE FREQUENT warnings that the planet and its natural and human resources are being exploited may seem to have little to do with the gifts and premium products industry but this is not the case, according to Miranda Kwan, SGS Hong Kong business development and marketing manager.

Ms Kwan will deliver a presentation at the Gifts & Premium Fair tomorrow, covering the implementation of corporate social responsibility programmes in the business world.

The presentation is intended to inform and educate Hong Kong manufacturers on how they can implement sustainable processes and comply with the corporate social responsibility requirements increasingly being applied in North America and Europe.

SGS Hong Kong, the local arm of the global systems and services certification company, advises and helps clients to achieve improved manufacturing efficiency and regulatory compliance through the testing of products and certification processes.

'Hong Kong companies with their huge manufacturing influence in the mainland could be in a position to do a lot more to achieve sustainable manufacturing and implement corporate social responsibility,' Ms Kwan said.

Corporate social responsibility programmes can help companies meet or exceed legal and social expectations, benefit employees and raise a company's profile.

Corporate social responsibility is viewed as a comprehensive set of policies, practices and programmes integrated into business operations, supply chains and decision-making processes throughout a company. It includes responsibility for current and past actions, and future impacts.

Ms Kwan said the gifts and premium sector tended to lag Hong Kong's textile and toy manufacturers, who were more aware of corporate social responsibility issues and had made considerable changes to their sourcing of raw supplies and manufacturing processes.

This was mainly because gift and premium manufacturers dealt with a wider product range involving multiple suppliers and production lines in different factories.

'Sometimes companies are required to produce a range of items in a short period of time or a small volume of orders with tight margins, so [social responsibility] is overlooked,' Ms Kwan said.

As the concept becomes more widespread, shareholders, analysts, regulators, activists, labour unions, employees, community organisations and the media are asking companies to be accountable for their own performances and those of their supply chains.

Ms Kwan said the field had grown exponentially in North America and Europe in the past decade.

A considerable number of companies from Europe and North America either manufacture goods in China or work through partnership arrangements with Hong Kong companies.

'More companies than ever are engaged in serious efforts to define and integrate [social responsibility] into all aspects of their business, with their experiences being bolstered by a growing body of evidence that it has a positive impact on business growth and economic performance,' Ms Kwan said.

Recycling cuts waste-disposal costs and generates income.

In the human resources arena, flexible scheduling and other work-life programmes curb absenteeism and increase staff retention, saving companies money through increased productivity and lower hiring and training costs.

Corporate social responsibility will become increasingly important, Ms Kwan said.

Multinational firms are increasingly implementing initiatives by enforcing standards and closely monitoring the conduct of suppliers.

Hong Kong companies that fail to introduce a programme could find themselves removed from preferred suppliers lists and struggling to sell their products.

Ms Kwan said the initial costs to implement corporate social responsibility programmes could be significant but they were considered an investment for long-term business growth.

Ms Kwan said corporate responsibility was increasing in importance against the backdrop of an ever more complex worldwide economy with continuing economic, social and environmental expectations.